The 12 Days of Credit: How to Whip Your Finances Into Shape by Christmas

If a new roof over your head is at the top of your shopping list this season, then a good credit score is the best gift you, or your true love, could ever receive. (Forget about those exploding Hoverboards, OK?)

That's because even if you've pulled together a down payment and lined up a terrific Realtor, without a credit score of 620 or preferably higher, you might not land one of the crucial achievements in the home-buying process: the mortgage pre-approval.

So before you start sizing up backyards on your tour of open houses, treat yourself and your main squeeze to a few (or all) of these gifts that are sure to help those three little numbers be as high as possible this Christmas. Don't worry -- we promise they're a heckuva lot easier than fighting mall traffic.

A trip to annualcreditreport.com lets you check each of your three credit reports for free once a year. That regular checkup can help you spot -- and correct -- a potential problem that might lock you and your true love out of your dream digs, says Randy Padawer, consumer education specialist at Lexington Law Firm in North Salt Lake, UT.

On the second day of Christmas, my true love gave to me…

… two loan or credit card payments made early.

Early payments cut down the amount of interest on your debt. They also reduce the chances you'll overspend on your "nice list" -- you don't want to risk hurting your credit score by blowing money allotted for bills on holiday gifts, do you?

On the third day of Christmas my true love gave to me…

… the information to place a credit freeze on my three credit reports.

Experian, TransUnion, and Equifax all offer consumers the option to prevent the release of your credit report without your consent. That credit report freeze gives you control over who accesses your personal and financial information, but beware -- it may also delay, interfere with, or prohibit the timely approval of your mortgage application.

On the fourth day of Christmas my true love gave to me…

… four paid hours to work with a credit counselor.

Even the best of budgeters can benefit from a second set of eyes. And in case the review of your credit report a few days ago turns up some unsavory tidbits, a credit counselor can get you on the path to cleaning things up in order to get that new home.

On the fifth day of Christmas my true love gave to me…

… five golden factors that determine my credit score.

"Like unicorns and elves, the perfect credit score of 850 is extremely rare," Padawer says. "However, understanding the five factors that determine a credit score and the way it is measured can help to boost your score and better your financial future."

Those golden factors are payment history (35%), debt and credit utilization (30%), length of credit history (15%), new accounts and inquiries (10%), and diversification (10%).

On the sixth day of Christmas my true love gave to me…

… a six-month emergency fund.

"Savings equals security, and living without an emergency fund is a risk that nobody should take," says Harrine Freeman, author of "How to Get Out of Debt." Before buying into the financial responsibility of a mortgage, you should have at least six months of income, which will shelter you from credit-busting events such as unemployment, increased cost of living, medical emergencies, and home or auto damage.

On the seventh day of Christmas my true love gave to me…

… a digital calendar to remind me to review my budget weekly.

Google Calendar, an iPhone app, or an old-fashioned wall calendar also helps you keep track of bills to ensure timely payment. Remember, bills paid late (even just one) can lower your score by several points, says Freeman.

On the eighth day of Christmas my true love gave to me…

… a list of eight apps that help track my spending and budgeting.

Even better than a system to help you pay your bills on time is one that gives you an overview of your income and expenditures, to help you fine-tune your budget. A few that Santa's elves are fond of include Spendbook, Mvelopes, Stay on Budget, Wally, YNAB, Dollarbird, BillGuard, and Mint.

"That's a great way to generate extra cash to stash for upcoming moving expenses, pay off debt weighing down your credit score, or start an emergency savings account," Freeman says.

On the 10th day of Christmas my true love gave to me…

… 10 clipped coupons to start a new collection.

As old-school as it sounds, coupons can save serious coin at the grocery store and on life's little essentials, you know, like toilet paper.

"Coupons are like free money," Freeman says.

If you're going to buy the SpaghettiOs, the Velveeta, or the Cottonelle Ultra anyway, why not spend a little less for it? Those nickels and dimes can add up fast and create some room in your budget to save for a down payment or pay off a bill to boost your credit score.

"It's smart to know exactly how long it will take to pay off a credit card or get out of debt," Freeman says.

And debt calculators provide that essential viewpoint to help you understand if you're on track or need to adjust your budget to meet financial goals.

On the 12th day of Christmas my true love gave to me…

… a year's subscription to a credit reporting service that guards against identity theft.

"When your identity is stolen, the thief can open accounts and run up debts in your name, hurting your credit score," Padawer says.

A credit reporting service instantly alerts you when a new account is opened in your name and/or in the event of suspicious activity. In some cases, it also informs users of any changes (positive or negative) to their credit score.

CreditKarma.com offers free credit monitoring, but Freeman says a paid service such as BillGuard.com offers more preventive features and more assistance in the event your identity is stolen.

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And don't forget the all-important, 13th day of Christmas few sing about. That's when you should gather all your pre-approval facts and figures to speed up the process. Pull together personal information (driver's license, SSN, etc), proof of assets, and the exact down payment amount you can afford.

Because the best Christmas gift of all is being able to buy your dream home.